1933 Industries Inc. (TGIFF)

[greenwillow]

1933 Industries Conference call (August 13th)

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The following is a detailed description of a Conference Call interview a few $TGIF retail "long's" had with 1933 industries Board Chairman Brayden Sutton and CEO Chris Rebentish. All the information presented below was collected during the call and comes directly from them without assumptions, opinion or embellishment. August 13, 2019.

1.First question was regarding liquidity and Current Cash position It was reported that all current projects are FULLY FUNDED until completion. That includes the Hemp processing/CBD extraction facility on pace to be completed by end of year. WE are well capitalized with approximately $16-$17 million in cash. It was reported by Chris that at the current and projected burn rate if nothing else changes (which will be in a big way soon) we are fully capitalized until at least 2021 without the need for any further capital raises (i.e. further dilution).

2. We inquired about the minimum SP required for up listing to the NASDAQ which we assumed was $4 Brayden reported that they would be eligible at $2, which everyone on the call felt was very achievable. We didn’t really press on timeline. However, we raised the notion of a sale of the AMA (THC) side of the business in order to facilitate the up listing. Chris’s response was that the would not be considering this move until AMA is built into what they believe is its full potential and has real equity. They are not selling it for peanuts as it has brand, quality and soon to be high volume value.

3. Comments on the delay in moving the clones into the new completed AMA facility. As many of us have heard, the clones have yet to be moved into their new home over at 5045 Geist. The facility requires a full cleaning/sterilization and Chris also told us that in a brand spanking new building with sophisticated equipment and controls required to grow and support life all systems must be a go before the full green light is given. He mentioned that they had to test all systems and some were not working up to spec on their first few runs. Calibration was required, retesting done and all looks to be go. Plants could have been moved in but they did not want to risk anything. He indicated they are actually working on the NR as we speak and Chris said its “literally around the corner”

4. Details regarding Birdhouse product line All involved are very excited about this initiative. R&D just finished on new co-branded products. There will be new products and re-branding some existing products ie. Chris mentioned re-branding/packaging of our CBD pain lotion under the Birdhouse product line. A new Marketing firm has been brought on board for the Birdhouse Launch. According to Chris, they have recently secured a deal with a Nationwide retailer that has agreed to carry the Birdhouse/1933 product line coast to coast. We pressed on the timeline to release and Chris estimated 1-2months. Another exciting development is that the deal with tony hawk has attracted attention of other “mainstream” athletes and Chris anticipates other deals/sponsorships with some other well know athletes very soon.

5. Is the CBD building still on pace for an end of year completion According to Chris we are still on pace for an end of year completions barring of course any unforeseen delays. All major customized equipment was ordered in the last 2 months which has the longest lead time according to them as they mostly come from Germany. They have not released to much info regarding this building as it is cutting edge, state of the art and the are hell bent on protecting their IP. Chris remains confident that the project will be completed by the end of this year with first products out the door in Jan/Feb 2020. Chris and Brayden really started getting excited when talking about this facility. For example, Brayden mentioned when he brought in Paul Rosen, Rosen met with Chris for hours where he outlined the company goals, plans, strategy and of course showed him what was planned for the CBD facility, to say he was impressed/intrigued may be an understatement as it ended with Rosen cutting a 4.5million dollar check. An exciting development in the call was when Chris reported that that the “figures we put out in the press release regarding the output capacity of this facility were extremely conservative” referring to the 4-5000kg/month of CBD isolate. He feels that once fully optimized the facility will have the potential to produce upwards of **10,000KG/MNTH of CBD**. We then inquired about the potential production amount of the other highly sought after, extremely valuable cannabinoids (ie CBN). He mentioned that in this new facility they have derived a way to convert THC into CBN and will have the capacity to produce about .5-1kg/day so roughly 20kg /month. As it is extremely difficult to find/produce, **the market price for CBN is $60,000/kg**. The one concern is that the regulatory bodies are still behind in CBD and because CBN is derived from THC there may be hurdles for it to get it to the national market. Also, with the new facility we will be able to reduce the cost of production of our CBD elixirs by almost half (from $7 to $4 per unit). We inquired whether or not they have contracts/supply deals lined up to take the projected CBD supply (obviously a portion will be used for our own product line, but we will have a large bulk sales portion) Chris indicated that they do not have anyone signed per say, but have many companies that have already said we will take everything you produce. Brayden mentioned that it is not a problem of figuring out who to sell to it ensuring you have enough to sell once committed. Chris indicated the price per KG of CBD is coming down but still very profitable.

6. We asked about the recent meeting regarding the change in policy for interest payments to debenture holders They mentioned that they are doing this to get a feel for the crowd. They are trying to free up and retain as much cash as possible mainly for the potential of Acquisition, they want to be liquid to be able to capitalize on opportunities as they present themselves.

The below were not answers to specific questions but information gleaned from back and forth conversation at the end of the call

• Firstly, Brayden and Chris are just amazing, down to earth, easy to talk to guys that are both extremely knowledgeable and passionate about this industry and this company. You can really tell a lot about a company by its leadership. My resolve and confidence in management and this company has never been stronger.

• Brayden mentioned that not a single insider has sold shares. He also mentioned our total number of subscribed retail investors is increasing when others are decreasing despite the lagging in SP. Chris and Brayden indicated that we have 26, 000 individual retail investors which says a lot about the outlook of the company. Most others in the space with much higher valuations and SP are having a difficult time breaking 20k.

• Brayden and Chris did not come in to the company given huge amounts of shares like other companies where once those shares are unlocked, they go dumping them looking to cash out. They are both focused on building this companies equity and value to its full potential

• When I mentioned that I am planning to be in Vegas by year end and they both graciously invited me down for a full tour and meet and greet. Brayden said that everyone that has been down for a tour has been blown away.

• Finally, Chris stated that they just completed there Q4 ending July 31, 2019 and it is there best Quarter to date!